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PS5 preorders Animal Crossing: New Horizons fall update Amazon showcase Second stimulus check Amazon Echo 2020 Amazon Echo Show 10 New Alexa features tops 2Q forecasts, sales disappoint managed to beat the consensus estimate in its second quarter Wednesday but still lost $89 million, or 33 cents a share, on disappointing sales of $578 million.

First Call Corp. consensus expected the online retailer to lose 35 cents a share in the quarter.

Ahead of the earnings report, (Nasdaq: AMZN) shares fell 1 9/16 to 36 1/16, primarily as a result of a scathing downgrade and research note from Lehman Brothers analyst Holly Becker.

The stock slid to 32 1/4 in after-hours trading.

The $578 million in sales represents an 84 percent jump from the year-ago quarter when it lost $67.2 million, or 26 cents a share, on sales of $314 million. However, officials said on an analyst conference call that second quarter sales fell short of their internal projections. was hoping for sales growth of 90 percent year-over-year.

Last quarter, slipped past analysts' estimates, losing $122 million, or 35 cents a share, on sales of $574 million.

"While we continue to see improvements in all of our businesses, we are especially pleased with the profitability in our U.S. books, music and video group and the unusual growth in our Electronics store," said CEO Jeff Bezos. "For the company as a whole, we're well on our way to achieving our 2000 objectives."

Officials said they plan to drive operating losses to single digits as a percentage of sales.

On the conference call, Bezos also tackled the perception issues surrounding the departure of operating chief Joseph Galli, who became the chief executive at VerticalNet (Nasdaq: VERT).

Bezos said Galli served as a symbol of's drive to profits. Meanwhile, Bezos was known for his damn-the-profits, grow-at-any-cost strategy. "As CEO I'm relentless committed to driving profitability, efficiencies and balanced growth," said Bezos, who added that half of the company's technology spending is allocated to boost profits. also said it would work to boost gross margins. However, it won't be able to depend on its Amazon Commerce Network. High-margin deals with the likes of, and will have to be renegotiated, said Bezos.

In the quarter, added another 2.5 million customer accounts, bringing its total to more than 22.5 million. Repeat orders accounted for 78 percent of its sales in the quarter.

Its books, music and video units posted a pro forma profit of $10 million in the quarter.

Of course,'s book business has never been a concern to analysts or investors.

In a note titled "Throwing in the towel on Amazon," Becker slashed her recommendation on the stock to "neutral" from "buy."

"To justify current valuation, the company must expand beyond books, and to date, the company's new businesses have demonstrated a lack of traction," Becker wrote in a research note. "We expect revenue will likely be $10 to $20 million lower than our original estimate of $597 million but we believe that this is widely expected."

Meanwhile, shares continue to wilt.

After soaring to a 52-week high of 113 in December, the stock fell to a low of 32 7/16 earlier this month.

Despite its recent woes, 25 of the 31 analysts following the stock rate it either a "buy" or "strong buy."

Analysts are expecting it to lose $1.27 a share in fiscal 2001.